Collapsed mining services company Forge Group placed in liquidation after meeting of creditors

COLLAPSED mining services company Forge Group has been placed in liquidation at a meeting of administrators and creditors in Perth.

More than 1500 Forge Group employees were sacked after Forge went into administration in February with around more than $500 million in debts.

Based on a preliminary assessment by administrators Ferrier Hodgson, the cause of Forge Group's failure included a general market downturn, cost escalations, risk control measures and limited diversification.

Ferrier Hodgson also said a debt focused capital structure, failed restructuring initiatives and risks relating to the structure of the business had materialised.

“We will consider all of these matters further as liquidators,” Ferrier Hodgson said in a statement.

Questions also remain over whether the company was trading while insolvent, it said.

Ferrier Hodgson will examine the bonuses paid to directors as well as concerns about mismanagement and cost variances.

A review of employee entitlements is expected to be completed in three to four weeks.